FOR 1882:  Psychoeconomics. Interacting Decision Processes and their Consequences for Economic Performance

• Subject Area: Social and Behavioural Sciences
• Term: from 2012 to 2019
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 215899445

Economics and psychology can both be called "decision sciences". Understanding actual human decision making is essential for both disciplines. Proper models of decision making are essential for understanding the consequences of economic and social policy, the effect of incentives and education on performance, the functioning of markets, and the allocation properties of economic institutions. The last decades have witnessed a steady approximation of behavioural schools within economics and psychology, as demonstrated, e.g., by the rise of the subdiscipline of behavioural economics. In this process, it has been recognised that normative economic models still lack a proper, systematic psychological foundation, while experimental psychology can greatly benefit from the formal approaches that characterise modern economics. The Research Unit brings together researchers from different disciplines in a joint effort to develop an integrative, data-driven understanding of how interacting motives and strategies determine actual human behaviour, how human agents can regulate the resulting decision conflict or learn from it, and what are the economic consequences of decision conflicts and their regulation. The research plan is structured around dual-process theories of human behaviour, which build mainly on insights from cognitive and social psychology. These theories postulate that human behaviour is the result of the interaction of different types of decision processes within a human decision-maker’s mind, some being more "automatic" (fast, effortless and typically unconscious), and some more "controlled" (slower, not immediate and consuming cognitive resources). It is our opinion that the basic paradigms underlying these theories hold the potential to deliver a new, improved framework for understanding actual human (economic) behaviour. Two further key elements to be considered within the common research agenda are as follows: (1) heterogeneity in behaviour, both across individuals and within an individual. While the former has already been incorporated in standard economic models, the latter is frequently ignored. (2) regulation of behaviour ("behavioural engineering"). While economists often reduce this point to the design of (monetary) incentives, psychology identifies a host of (cost-neutral) factors and interventions whose interaction with incentives needs to be better understood.

• DFG Programme: Research Units
• International Connection: Switzerland

Projects

• Consumer Credit Decisions in a Dual-Process Perspective (Applicant Hoelzl, Erik )
• Economic Rationality and Competing Behavioral Rules (Applicant Alós-Ferrer, Carlos )
• Motivational States and Incentives (Applicant Achtziger, Anja )
• Personality Traits, Preferences and Economic Success (Applicant Pohlmeier, Winfried Franz Xaver )
• Processing Social Preferences (Applicant Fischbacher, Urs )
• Psychoeconomics: Interacting Decision Processes and Their Consequences for Economic Performance (Applicant Achtziger, Anja )
• Repeated Stochastic Processes in Single Trial EEG-Analysis - Statistical Theory and Methods (Applicant Beran, Jan )
• The self-regulation of decision-relevant modes of thought (Applicant Gollwitzer, Peter M. )
• "Time is Money": How Decision Makers Find the Balance Between Deciding Quickly and Deciding Correctly (Applicant Hübner, Ronald )

• Spokesperson: Professorin Dr. Anja Achtziger, since 4/2018